Startup claims it will build fiber network in LA and wireless throughout US

$70 billion plan sounds… perhaps overly optimistic.

A startup has told Los Angeles city officials that it wants to build a citywide fiber-to-the-home broadband network and that it also hopes to build nationwide Wi-Fi and cellular networks.

The proposal sounds unlikely to succeed, but it's certainly ambitious. It comes in response to a Los Angeles city government request for information (RFI) regarding a plan to build a fiber and Wi-Fi network. The Los Angeles request itself struck telecom experts as unrealistic. The city wants a vendor to build a fiber network at an estimated cost of $3 billion to $5 billion, offer free Internet to all residents (while charging for faster speeds), and make the infrastructure available to any other service provider on a wholesale basis.

The RFI deadline passed Friday, and only one company has made its full response to the city public. It's a Dutch company called Angie Communications, which claims it will build fiber and mobile networks in the Netherlands, the UK, Germany, France, and the US.

Further Reading

You can read Angie's 18-page response to LA here. The company says it will cost $2.5 billion to reach the break-even point in its plans, which "will mainly come from investors, suppliers and builders." The "lifetime" cost of Angie's nationwide network is estimated at a whopping $70 billion.

Angie says it has €50 million ($67.6 million) from investors, which isn't enough to get started on building. That money "will be used by the Company from November 2014 onwards to pay for initial operations (salaries, retail operations, marketing, etc.) in its markets as well as to raise funds by way of a six-month road show."

Angie says it would build the entire LA fiber network, "including the backbone, the metro and street access infrastructure," within five years. Speeds would hit 1Gbps or 10Gbps and not be limited to Los Angeles. Angie wants its fiber to pass "at least five (5) million premises (homes, offices, businesses) nationwide in its own 'rolled out' markets." Angie last year said it would build fiber in San Jose.

The company also told Los Angeles that it wants to build a 4G cellular network "covering 95 percent of the nation's population" with speeds of 10Mbps to 50Mbps. "Angie Mobile will build, own and operate its own 4G network to serve as a brand-new Mobile Network Operator," the company said.

The plan also includes a Wi-Fi network covering 90 percent of the US population with speeds up to 100Mbps. Might as well dream big, right?

Los Angeles officials will want to scrutinize Angie's promises carefully. As we've written before, there are reasons why the US broadband market has so little competition. Funding new networks in cities that already have providers is hard for investors to justify because it takes years to gain enough customers to reach profitability.

Besides that, Angie apparently doesn't want to sell wholesale access to other providers. "Angie is in the business of building infrastructure in order to own and operate those infrastructures itself," the company said. "It may be economically unattractive (in terms of probability to recoup investments) for Angie to provide access to third parties. Nonetheless, providing such access on a wholesale or white label basis (at the operator and/or access level) is something that Angie is willing to discuss with a select group only. NOTE: If Angie would be required to provide open access from day one, Angie would most certainly pass on the opportunity."

Time Warner Cable says it’s on track for gigabit speeds

Angie was one of 34 entities who responded to LA's RFI, but that doesn't mean all of them want to build a network. The city will issue a request for proposals (RFP) later on. The RFI asked for input on the project to help draft the future RFP.

The city is not revealing the contents of any responses "until after the RFP is released and contract[s] are awarded," Los Angeles CTO Steve Reneker told Ars.

Time Warner Cable didn't reveal its full response to LA but issued a press release saying that it gave LA officials "information on its current and future network and product enhancements that will enable Time Warner Cable to deliver gigabit-per-second speeds for consumers in Los Angeles across TWC’s existing network that already spans the city and neighboring communities."

Promoted Comments

Reading this document - when you describe your company as "having an old soul" or use the phrase "cracked the code", yeah..... no. Those are big red flags going off that what follows is likely to be marketing BS.

Also, when you make the claim that you're going to enter the US Market as a Mobile Network operator and build all your own infrastructure - that's great and all but...... Where are you going to get your spectrum? Your spectrum ALONE is going to cost more than $2.5 or $5 billion dollars or whatever silly figure that's getting thrown around.

Reading this document - when you describe your company as "having an old soul" or use the phrase "cracked the code", yeah..... no. Those are big red flags going off that what follows is likely to be marketing BS.

Also, when you make the claim that you're going to enter the US Market as a Mobile Network operator and build all your own infrastructure - that's great and all but...... Where are you going to get your spectrum? Your spectrum ALONE is going to cost more than $2.5 or $5 billion dollars or whatever silly figure that's getting thrown around.

"Does your organization have assets that may be useful for deployment of the LACBN, and that you may be willing to provide to an entity selected through the RFP process? What are those assets?

RESPONSE: Angie has access to many assets in the City. However, it is required to pay for the use of any such assets. Angie as a company has no own property or assets as of yet and is therefore not capable of assisting any parties. Also, Angie is in the business of building infrastructure in order to own and operate those infrastructures itself. It may be economically unattractive (in terms of probability to recoup investments) for Angie to provide access to third parties. Nonetheless, providing such access on a wholesale or white label basis (at the operator and/or access level) is something that Angie is willing to discuss with a select group only. NOTE: If Angie would be required to provide open access from day one, Angie would most certainly pass on the opportunity."

Reading this document - when you describe your company as "having an old soul" or use the phrase "cracked the code", yeah..... no. Those are big red flags going off that what follows is likely to be marketing BS.

Also, when you make the claim that you're going to enter the US Market as a Mobile Network operator and build all your own infrastructure - that's great and all but...... Where are you going to get your spectrum? Your spectrum ALONE is going to cost more than $2.5 or $5 billion dollars or whatever silly figure that's getting thrown around.

The sheer fact that Ars talked directly to the CEO of this company is a red flag in my book. Not that Ars isn't one of the best tech/science news outfits on the tubes, because they are. But CEOs of companies that can manage multi-billion-dollar projects have People who are specifically on the payroll to answer those sorts of questions.

"Does your organization have assets that may be useful for deployment of the LACBN, and that you may be willing to provide to an entity selected through the RFP process? What are those assets?

RESPONSE: Angie has access to many assets in the City. However, it is required to pay for the use of any such assets. Angie as a company has no own property or assets as of yet and is therefore not capable of assisting any parties. Also, Angie is in the business of building infrastructure in order to own and operate those infrastructures itself. It may be economically unattractive (in terms of probability to recoup investments) for Angie to provide access to third parties. Nonetheless, providing such access on a wholesale or white label basis (at the operator and/or access level) is something that Angie is willing to discuss with a select group only. NOTE: If Angie would be required to provide open access from day one, Angie would most certainly pass on the opportunity."

So.... so much for open access, huh?

LA ISP run by shady company with stupid name... what could POSSIBLY go wrong???

The sheer fact that Ars talked directly to the CEO of this company is a red flag in my book. Not that Ars isn't one of the best tech/science news outfits on the tubes, because they are. But CEOs of companies that can manage multi-billion-dollar projects have People who are specifically on the payroll to answer those sorts of questions.

If we would have been having this discussion at the turn of the century about telephone infrastructure, there would be riots in the streets. Individual companies building out redundant telephone networks makes no sense. All you really need is one telephone cable to go to each residence/business. As made sense, we created utilities that built ONE set of phone lines and charged access to allow providers to use them.

"Does your organization have assets that may be useful for deployment of the LACBN, and that you may be willing to provide to an entity selected through the RFP process? What are those assets?

RESPONSE: Angie has access to many assets in the City. However, it is required to pay for the use of any such assets. Angie as a company has no own property or assets as of yet and is therefore not capable of assisting any parties. Also, Angie is in the business of building infrastructure in order to own and operate those infrastructures itself. It may be economically unattractive (in terms of probability to recoup investments) for Angie to provide access to third parties. Nonetheless, providing such access on a wholesale or white label basis (at the operator and/or access level) is something that Angie is willing to discuss with a select group only. NOTE: If Angie would be required to provide open access from day one, Angie would most certainly pass on the opportunity."

So.... so much for open access, huh?

LA ISP run by shady company with stupid name... what could POSSIBLY go wrong???

Can't be any worse than the shady companies who actively collude to monopsonise the whole country, eh?

Well all they need to do is provide functional Internet access with mediocre customer support at a price point that that only moderately wrecks your wallet... and they would be the BEST ISP in America.

and make the infrastructure available to any other service provider on a wholesale basis.

I can't say much about anything else, but at least the city got this much of the RFI right. Unbundled network elements are what cities need.

And yet, as far as I can tell, muni networks are not open access networks. If anyone has other information, please enlighten me. In this case, Angie has already said that is one provision it won't comply with.

Why? This is for a potential contract between the provider and the city.

Why do interested third parties deserve to know any details? Once the contract is awarded, I assume the final contract will become s public record, and at that time available to the public, which of course no one will read. Bids from non-winners generally remain confidential.

When was the last time time you read any contracts awarded by your local town or city?

I wish them luck, but it will never happen. The US telco companies will NEVER let it happen.

Honestly, Google is the only company with the political "juice" to build out fiber to everyone in the US. And even they have to fight battles. There's a reason that it's taking so long for Google to roll out their services to various cities...the political battles are epic.

What's funny is that if Verizon or AT&T had *any* foresight, they would realize that building out fiber to everyone in the US would position them to have a revenue stream that would last 100 years or more. But short-term profits rule the day.

Reading this document - when you describe your company as "having an old soul" or use the phrase "cracked the code", yeah..... no. Those are big red flags going off that what follows is likely to be marketing BS.

Also, when you make the claim that you're going to enter the US Market as a Mobile Network operator and build all your own infrastructure - that's great and all but...... Where are you going to get your spectrum? Your spectrum ALONE is going to cost more than $2.5 or $5 billion dollars or whatever silly figure that's getting thrown around.

Probably by selling off their Unicorn and Nessie assets, and a strategic Rainbow realignment.

I'm not sure if they are really just ignorant of the difficulties of the US market and being overly optimistic or if they are just lying for some strange reason.

Unfortunately, the autonomy of the local government is one of the things that makes trying to accomplish this very difficult. You can't just deal with the federal government or even state government for something like this. You end up having to deal with city, towns and municipalities all of which can have their own laws impacting things and may have existing deals with incumbents that get in your way. This is part of the reason Google is selecting its specific areas for deploying Google fiber. It's only looking at places that are relatively simple to work with from the various different perspectives.

Yes, if one were implementing things now a single IP infrastructure is the obvious way to do things and then providing access to anyone who wants to run a service on top of that. The fact is that the current duopoly came about from two completely separate and different past services both ending up providing IP connectivity. Telephone Service and Cable service which gives you two entrenched incumbents with plenty of incentive to protect the status quo and in many cases legal contracts that do that for them.

I also agree that the 4g network is pretty much impossible because they'd need spectrum to do that and unless they have a ton of money to bid on the upcoming 600mhz auction and beat out all the current cell phone providers the chances of getting anything resembling nationwide coverage on a single band to easily provide that services is pretty much nill and there is no obvious source for any additional spectrum for another future auction. On top of that a good 4g network needs a couple different blocks of spectrum. You need some low frequency spectrum for range and building penetration to get good coverage and higher frequencies for good cell density and total aggregate bandwidth in higher population density areas.

and make the infrastructure available to any other service provider on a wholesale basis.

I can't say much about anything else, but at least the city got this much of the RFI right. Unbundled network elements are what cities need.

What is the City offering to prospective companies who submit an RFP in exchange for such access? I would say that if the CITY itself built a fiber backbone through the city, then it would make sense to "sell off" wholesale access to anyone who wants to tap into the fiber to complete the "last mile".

But, telling potential telecom companies, "Yeah, we want you to spend hundreds of millions or billions of dollars to build out fiber in our city, and oh, yeah, we want you to make it available to anyone at wholesale costs", and the only thing you are offering in return is the mere right to build in the city, well, it's not terribly surprising you maybe don't get a lot of offers.

I really do think cities ought to build fiber networks which are owned by the municipality, but let other companies build the last mile connection, and do the marketing and user support (as well as, potentially, content like cable tv channels over IP). That sort of hybrid public/private model seems like it could work well for telecom.

Why? This is for a potential contract between the provider and the city.

Why do interested third parties deserve to know any details? Once the contract is awarded, I assume the final contract will become s public record, and at that time available to the public, which of course no one will read. Bids from non-winners generally remain confidential.

When was the last time time you read any contracts awarded by your local town or city?

When Lyle Landley strolls in your town hall and starts singing the monorail song, you kind of have to wonder how he's planning to make all his promises come true, especially for a project this massively expensive where he's bound to start asking the government for huge subsidies, interest-free loans and tax breaks for something so incredibly huge and expensive that most sane businessmen would have written it off as bound to collapse under its own weight.

Why? This is for a potential contract between the provider and the city.

Why do interested third parties deserve to know any details? Once the contract is awarded, I assume the final contract will become s public record, and at that time available to the public, which of course no one will read. Bids from non-winners generally remain confidential.

When was the last time time you read any contracts awarded by your local town or city?

When Lyle Landley strolls in your town hall and starts singing the monorail song, you kind of have to wonder how he's planning to make all his promises come true, especially for a project this massively expensive where he's bound to start asking the government for huge subsidies, interest-free loans and tax breaks for something so incredibly huge and expensive that most sane businessmen would have written it off as bound to collapse under its own weight.

Why? This is for a potential contract between the provider and the city.

Why do interested third parties deserve to know any details? Once the contract is awarded, I assume the final contract will become s public record, and at that time available to the public, which of course no one will read. Bids from non-winners generally remain confidential.

When was the last time time you read any contracts awarded by your local town or city?

When Lyle Landley strolls in your town hall and starts singing the monorail song, you kind of have to wonder how he's planning to make all his promises come true, especially for a project this massively expensive where he's bound to start asking the government for huge subsidies, interest-free loans and tax breaks for something so incredibly huge and expensive that most sane businessmen would have written it off as bound to collapse under its own weight.

I wish them luck, but it will never happen. The US telco companies will NEVER let it happen.

Honestly, Google is the only company with the political "juice" to build out fiber to everyone in the US. And even they have to fight battles. There's a reason that it's taking so long for Google to roll out their services to various cities...the political battles are epic.

What's funny is that if Verizon or AT&T had *any* foresight, they would realize that building out fiber to everyone in the US would position them to have a revenue stream that would last 100 years or more. But short-term profits rule the day.

If they had any vision, Western Union would realize that running telegraph wires to every neighborhood, town and city in the U.S. would position them to have a revenue stream that would last 100 years or more!

and make the infrastructure available to any other service provider on a wholesale basis.

I can't say much about anything else, but at least the city got this much of the RFI right. Unbundled network elements are what cities need.

What is the City offering to prospective companies who submit an RFP in exchange for such access? I would say that if the CITY itself built a fiber backbone through the city, then it would make sense to "sell off" wholesale access to anyone who wants to tap into the fiber to complete the "last mile".

But, telling potential telecom companies, "Yeah, we want you to spend hundreds of millions or billions of dollars to build out fiber in our city, and oh, yeah, we want you to make it available to anyone at wholesale costs", and the only thing you are offering in return is the mere right to build in the city, well, it's not terribly surprising you maybe don't get a lot of offers.

I really do think cities ought to build fiber networks which are owned by the municipality, but let other companies build the last mile connection, and do the marketing and user support (as well as, potentially, content like cable tv channels over IP). That sort of hybrid public/private model seems like it could work well for telecom.

This is basically what the failing UTOPIA project in Utah is. Getting others to pay for the "last mile", or even the last 50 feet, has proven to be far from trivial. And public support is hard to maintain when taxes go up for everyone and the benefits are only seen by a small percentage.

"Does your organization have assets that may be useful for deployment of the LACBN, and that you may be willing to provide to an entity selected through the RFP process? What are those assets?

RESPONSE: Angie has access to many assets in the City. However, it is required to pay for the use of any such assets. Angie as a company has no own property or assets as of yet and is therefore not capable of assisting any parties. Also, Angie is in the business of building infrastructure in order to own and operate those infrastructures itself. It may be economically unattractive (in terms of probability to recoup investments) for Angie to provide access to third parties. Nonetheless, providing such access on a wholesale or white label basis (at the operator and/or access level) is something that Angie is willing to discuss with a select group only. NOTE: If Angie would be required to provide open access from day one, Angie would most certainly pass on the opportunity."

So.... so much for open access, huh?

LA ISP run by shady company with stupid name... what could POSSIBLY go wrong???

Wake me up when someone starts taking about servicing the entire LA megacity. As large as the City of Los Angeles proper is, the megacity is much larger. Depending upon exactly where you draw the lines, you're talking about all or part of three to five counties, somewhere in the neighborhood of one hundred and fifty incorporated cities, and around twenty million people, spread across well over five thousand square miles. (For comparison the City of LA proper has "only" between four and five million people, and covers less than five hundred square miles.) If you have trouble visualizing that, let me give a more human-scale example. I live right at what I would consider the eastern edge of the LA megacity, more than forty miles east of downtown LA.

I honestly don't believe it's possible for a new entrant to the market to wire all of LA. It's just too damn big.

As a long time resident of LA I just can't see this happening. We can't even keep graffiti off buildings and the public schools are atrocious. Plus if you take the low end figure, $3 billion to build, it would make more financial sense for the city to just pay for the cheapest broadband plan from the existing providers, TWC or AT&T. Per the last census, about 1.2 million households in the city, at a low end $20 MRC plan, that would be about $300 million a year, so the city could pay out $3 Billion over 10 years to provide free broadband to every household without having to build anything. And that's assuming everyone signed up.

A bond plan could probably raise the $3 billion immediately with so many pension funds buying tax free muni bonds without thinking about it and the city could probably bank the $3 billion and pay out over the term and probably get 3-5 more years out of the fund, and by that time, who knows what kind of technology standard will exist then. Or LA may have fallen into the ocean by then... fingers crossed.

Hey LA, fix the pothole in front of my house and get the pedophiles out of the teachers union and then we can talk about technology.

If we would have been having this discussion at the turn of the century about telephone infrastructure, there would be riots in the streets. Individual companies building out redundant telephone networks makes no sense. All you really need is one telephone cable to go to each residence/business. As made sense, we created utilities that built ONE set of phone lines and charged access to allow providers to use them.

Can't say I quite agree with that, if it wasn't for virgin laying their own cable (actually I think it was NTL or Bluesomething who laid the cable years ago, but the point stands) I would be stuck with a hit 'n' miss 15/1-2mbps BT connection over phone lines.

However, thanks to that extra cable being laid, instead I have an exceedingly juicy 120/10mbps rock solid line. and I'm by no means an edge case living out in the sticks or the like, I live in the heart of a major UK city (liverpool).

All the shadiness and never-going-to-happen-ness aside, I suppoprt this idea.

"Does your organization have assets that may be useful for deployment of the LACBN, and that you may be willing to provide to an entity selected through the RFP process? What are those assets?

RESPONSE: Angie has access to many assets in the City. However, it is required to pay for the use of any such assets. Angie as a company has no own property or assets as of yet and is therefore not capable of assisting any parties. Also, Angie is in the business of building infrastructure in order to own and operate those infrastructures itself. It may be economically unattractive (in terms of probability to recoup investments) for Angie to provide access to third parties. Nonetheless, providing such access on a wholesale or white label basis (at the operator and/or access level) is something that Angie is willing to discuss with a select group only. NOTE: If Angie would be required to provide open access from day one, Angie would most certainly pass on the opportunity."

So.... so much for open access, huh?

LA ISP run by shady company with stupid name... what could POSSIBLY go wrong???

Can't be any worse than the shady companies who actively collude to monopsonise the whole country, eh?

Sure it can. They can force out all others and offer even worse service.

Time Warner does seem to be more motivated. They rolled out DOCSIS 3 support in my North LA County neighborhood a few weeks ago and gave my plan a 5X upgrade for the same price, taking me from 20+/2+ to 100/10 on the up/down throughput. The highest tier offers 300 down for those willing to pay.

If phantom promises from companies I've never heard of gets the incumbents to upgrade their stuff, then bring on the phantoms!

Time Warner claimed that LA residents didn't need or want 1GB speeds only a year ago. Now, suddenly, they want to do the network.

I say let them go ahead and build the MuniNet for the city. But, they have to allow the city free access to their fiber for MuniNet customers. If Time Warner does a better job than the city, with a better value than the city, then they'll keep their customers. If Time Warner is worse, then MuniNet would get the customers, and they wouldn' t need to pay for extra for access to the Time Warner-provided MuniNet.